Prices close just under $1,290 an ounce after Yellen’s Fed policy comments

SAN FRANCISCO (MarketWatch) — Gold futures climbed on Tuesday as traders took in Federal Reserve Chairwoman Janet Yellen’s testimony on monetary policy to the House Financial Services Committee, lifting the metal’s tally to a rise of more than 3% in five trading sessions.

Yellen signaled that the central bank will remain on the loose monetary-policy path laid out by Ben Bernanke.

Gold for April delivery
US:GCJ4
climbed $15.10, or 1.2%, to settle at $1,289.80 an ounce on the Comex division of the New York Mercantile Exchange after rising as high as $1,294.40. Prices held their ground at the highest close since mid-November and have gained 3.1% since their close at $1,251.20 a week ago.

March silver
US:SIH4
which briefly traded lower, closed up 4 cents, or 0.2%, at $20.15 an ounce.

AFP/Getty Images

“Yellen’s comments have been right down the middle of the road,” said Brien Lundin, editor of Gold Newsletter, adding that “gold was already trading nicely higher before her testimony began, largely on the back of a weaker dollar and strong Chinese demand.”

“Apparently all the gold market needed was an absence of damaging remarks from Yellen, as the price continued to strengthen as she talked,” he said. “This indicates that underlying bullish posture for gold is strong.”

“The recent string of positive days is building a much better technical picture as well, and this should bring more buying into the market,” Lundin said.

Jeffrey Wright, managing director at H.C. Wainwright, said the testimony and Q&A session “point to a longer timeline of existing interest rates regardless of the official unemployment rate,” and that’s positive for gold with a weaker U.S. dollar
DXY, -0.10%

Year to date, gold futures are up over 7% after finding some safe-haven buying last month.

The $1,300 level is “critical” and is being watched closely by many in the gold community, said Vedant Mimani, lead portfolio manager of the Atyant Capital Global Opportunities Fund. “If we get there, what will be more revealing is if gold can hold above that level.”

On Monday, gold futures extended their gains to a fourth-straight session, reaching their highest point in more than 2½ months as Chinese buyers returned to the market with an appetite for the metal following the recent Lunar New Year holiday.

For the short term, gold is “starting to find some traction — potentially putting in a bottom here,” according to Adam Koos, president of Libertas Wealth Management. The long-term picture is “still bright in light of the expectations of higher inflation at some point, likely in the last half of the decade.”

Other metals on Comex finished on a mixed note, April platinum
US:PLJ4
tacked on $1.90, or 0.1%, to $1,387.80 an ounce, while March palladium
US:PAH4
fell by 40 cents, or 0.1%, to $716.35 an ounce.

High-grade copper for March delivery
US:HGH4
gave up a penny, or 0.3%, to $3.215 a pound.

Intraday Data provided by SIX Financial Information and subject to terms of use.
Historical and current end-of-day data provided by SIX Financial Information.
All quotes are in local exchange time. Real-time last sale data for U.S. stock quotes reflect trades reported through Nasdaq only.
Intraday data delayed at least 15 minutes or per exchange requirements.